As more procedures migrate to the outpatient setting, the relationship between ASCs and health systems is evolving.
Once viewed primarily as competitors, many organizations are now collaborating through joint ventures, referral partnerships and shared efforts to improve access while lowering costs.
Four ASC leaders joined Becker’s to discuss the ways that ASC, hospital and health system relationships have changed over the last five years, and how they’ll continue to change in the near future.
Editor’s note: Responses have been lightly edited for clarity and length.
Question: How has the relationship between ASCs and health systems shifted over the last 5 years as more cases become approved for the outpatient setting? How do you see that relationship continuing to change in the next 5 years?
Julie Jackson, NP. Chief Administrative Officer of GI Associates (Milwaukee, Wis.)The relationship between ASCs and health systems has shifted from primarily competitive to increasingly interdependent. As more procedures have been approved and clinically accepted for the outpatient setting, health systems have had to rethink where care is delivered, how they manage capacity, and how they participate in lower-cost settings. ASCs offer efficiency, convenience and cost advantages, while health systems bring scale, referral networks, specialty access, and infrastructure. It’s important for ASC leadership to help health systems with their at-risk contract performance and moving cases over to ASCs. Over the next five years, I expect the relationship to continue moving toward more strategic alignment, whether through joint ventures, service-line partnerships, coordinated referral pathways or shared quality and site-of-service initiatives. At the same time, ASCs will need to protect what makes them effective: physician engagement, efficient workflows, strong patient experience and disciplined cost management. The most successful relationships will be those that recognize ASCs as an essential part of the care continuum — not just an alternative site, but a critical access point for high-quality, lower-cost outpatient care.
Lauren Phillips, BSN. Director of Invasive Services at The Cardiac and Vascular Institute (Chiefland, Fla.): The relationship between our local health system and our ASC has strengthened over the past year as more cardiovascular procedures have transitioned to the outpatient setting. We have established effective communication with hospital leadership to ensure continuity of care by sharing information on patients who present to either facility following a procedure. As the shift toward ASC-based care continues, collaboration between hospitals and ASCs will become increasingly important. However, this transition may also create challenges as hospitals experience declining procedural volumes, making it essential to maintain strong partnerships focused on patient outcomes rather than competition.
Raghu Reddy. Member of the Ambulatory Surgery Center Association’s Education and Quality Committees, Chief Administrative Officer MiOrtho Surgery Center (Southfield, Mich.): Over the last five years, the relationship between ASCs and health systems has become increasingly collaborative as more procedures have safely transitioned to the outpatient setting. With CMS continuing to expand outpatient eligibility and moving toward elimination of the ASC Covered Procedures List, health systems increasingly view ASCs as essential to retaining physicians, expanding capacity, lowering costs, and protecting market share.
Independent ASCs remain strong competitors because they often operate more efficiently and deliver a better patient experience at a lower cost. Large management companies will continue expanding their footprint, while certificate-of-need states may gradually create greater access to outpatient surgery as pressure to reduce healthcare costs intensifies.
Over the next five years, I expect continued growth in health system–physician joint ventures and stronger payer pressure to move appropriate cases out of hospital outpatient departments. Successful partnerships will depend on fair governance, transparent economics, physician alignment, and clear site-of-service criteria, and ASCs should remain open to mutually beneficial partnerships that strengthen access, efficiency and long-term sustainability.
Scott Shapiro, MD. Cardiologist at AMS Cardiology (Horsham, Pa.): As Atria Health’s CEO, Matt Eakins, has put it: “Over the next five years, cardiovascular cases have to migrate to the outpatient setting. More and more procedures can be safely and efficiently performed in outpatient centers. It’s no longer a question of if, but how fast. The health systems with foresight are working to win in it, and they’re looking for partners to help them get there. That means capital and operational expertise, but critically, independent physician leadership, because the groups that win in outpatient CV are the ones where physicians are truly in the driver’s seat.”
I’d add that the underlying relationship between hospitals and independent physician practices has changed fundamentally with the growth of ASCs. Where hospitals once held near exclusive control over surgical and procedural volume, physician-owned ASCs now compete directly for cases that were historically performed only within hospital walls, giving proceduralists both clinical autonomy and a direct financial stake in where care is delivered. That’s not a zero sum dynamic. Collaboration between hospitals and physician-owned ASCs, whether through joint ventures, co-management arrangements, or simply rational triage by case complexity, lets each setting operate at the top of its capability. Done well, that benefits hospitals, physicians, payers and patients alike, and I expect that collaborative model to keep deepening over the next five years as more complex cardiovascular cases prove safe for the outpatient setting.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.